UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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| Item 1.01 | Entry into a Material Definitive Agreement. |
On July 9, 2024, Great Elm Capital Corp. (the “Company”) entered into a purchase agreement (the “Purchase Agreement”) by and among the Company, Great Elm Capital Management, LLC and the purchasers named in Appendix A thereto in connection with a registered direct offering (the “Offering”) of $22,000,000 in additional aggregate principal amount of the Company’s 8.50% Notes due 2029 (the “Notes”). The Notes are an additional issuance of the Company’s 8.50% Notes due 2029, $34,500,000 aggregate principal amount of which has been previously issued and is outstanding.
The Notes will mature on April 30, 2029 and may be redeemed in whole or in part at the Company’s option at any time or from time to time on or after April 30, 2026 at a redemption price equal to 100% of the outstanding principal amount of the Notes to be redeemed, plus accrued and unpaid interest otherwise payable for the then-current quarterly interest period accrued to, but excluding, the date fixed for redemption. The Notes bear interest at a rate of 8.50% per year payable quarterly on March 31, June 30, September 30 and December 31 of each year, commencing September 30, 2024. The Notes are direct unsecured obligations of the Company.
The terms of the Notes are governed by the indenture, dated September 18, 2017 (the “Base Indenture”), between the Company and Equiniti Trust Company, LLC (f/k/a American Stock Transfer & Trust Company, LLC), as trustee (the “Trustee”), as supplemented by the sixth supplemental indenture, dated April 17, 2024, between the Company and the Trustee, and as further supplemented by an officers’ certificate of the Company, dated July 9, 2024 (the Base Indenture, as so supplemented, the “Indenture”). The Indenture contains certain covenants, including covenants requiring the Company to comply with Sections 18(a)(1)(A) and (B) as modified by Sections 61(a)(1) and (2) of the Investment Company Act of 1940, as amended, and to provide financial information to the holders of the Notes and the Trustee if the Company should no longer be subject to the reporting requirements under the Securities Exchange Act of 1934, as amended. The Indenture also provides that the Company may not consolidate with or merge with or into any other entity or convey or transfer all or substantially all of its properties and assets to any person, unless certain specified conditions set forth in Section 801 of the Indenture are satisfied. These and other covenants are subject to certain limitations and exceptions that are described in the Indenture.
The Company received net proceeds from the Offering, after payment of estimated offering expenses payable by the Company, of approximately $21.4 million. The Company intends to use the net proceeds from the offering for general corporate purposes and may also elect to (i) redeem or repurchase a portion of its outstanding $45.6 million aggregate principal amount of 6.75% unsecured notes due 2025, (ii) redeem or repurchase a portion of its outstanding $57.5 million aggregate principal amount of 5.875% unsecured notes due 2026, (iii) repurchase a portion of its outstanding $40.0 million aggregate principal amount of 8.75% unsecured notes due 2028 or (iv) repay all or a portion of any borrowings that may be outstanding under the Loan, Guarantee and Security Agreement, as amended, with City National Bank.
The Notes were offered and sold pursuant to a registration statement on Form N-2 (File No. 333-261274), as amended, and the related prospectus supplement filed with the Securities and Exchange Commission. The Offering closed on July 9, 2024.
The foregoing descriptions of the terms of the Indenture, the Notes and the Purchase Agreement do not purport to be complete and are qualified in their entirety by reference to their full text. The Notes and the Purchase Agreement are attached hereto as Exhibits 4.1 and 10.1, respectively, and are incorporated herein by reference.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information set forth in Item 1.01 is incorporated herein by reference.
| Item 8.01 | Other Events. |
In connection with the Offering, the Company is filing herewith the following exhibits to its Registration Statement on Form N-2 (File No. 333-261274):
| 1. | Global Note (8.50% Note Due 2029). |
| 2. | Opinion of Jones Day. |
| 3. | Opinion of Venable LLP. |
| 4. | Purchase Agreement, dated as of July 9, 2024, by and among the Company, Great Elm Capital Management, LLC and the purchasers named in Appendix A thereto. |
| 5. | Consent of Jones Day. |
| 6. | Consent of Venable LLP. |
On July 9, 2024, the Company issued a press release in connection with the Offering. A copy of the press release is filed as Exhibit 99.1 to this report.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
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Exhibit Number |
Description | |
| 4.1 | Global Note (8.50% Note Due 2029). | |
| 5.1 | Opinion of Jones Day. | |
| 5.2 | Opinion of Venable LLP. | |
| 10.1 | Purchase Agreement, dated as of July 9, 2024, by and among the Company, Great Elm Capital Management, LLC and the purchasers named in Appendix A thereto. | |
| 23.1 | Consent of Jones Day (included in Exhibit 5.1). | |
| 23.2 | Consent of Venable LLP (included in Exhibit 5.2) | |
| 99.1 | Press Release, dated July 9, 2024. | |
| 104 | The cover page of this Current Report on Form 8-K, formatted as inline XBRL. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| GREAT ELM CAPITAL CORP. | ||
| Date: July 9, 2024 | By: | /s/ Keri A. Davis |
| Name: | Keri A. Davis | |
| Title: | Chief Financial Officer | |